Having unresolved problems with the IRS can lead to severe consequences. The IRS can even seize funds from your paycheck or bank account(s) if you fail to address the matter.

There are a number of ways you can keep this from occurring. The first method we will look at is called Offer in Compromise. There is a Congress-mandated program that allows taxpayers to try to make an offer to settle their tax debt in full. The offer the taxpayer makes can be for less than the full amount owed, but it is calculated by the IRS. Once there is an offer in place, your property and wages are no longer seizable. This type of offer has three basic forms.

The first is called a Doubt as to Liability. This type of offer can only be made when the taxpayer questions whether he lawfully owes the money at all.

Doubt as to Collectability is the second type of offer. When you think of an Offer in Compromise, this is typically what you would refer to.

Effective Tax Administration is the third type of compromise. These offers are rare, at least in terms of acceptance by the IRS. In this type of settlement, usually the taxpayer is able to make the payment, but for some reason it is determined that it would be difficult to implement payment.

Now we will discuss the second basic way of resolving your problem, and it is a well-kept secret. It is based on the time limit for the collection of income tax. The Collection Statute Expiration Date (CSED) usually occurs ten years from assessment of the original tax debt. It is possible to simply wait this out.

The third way to handle IRS difficulties applies if a taxpayer has no ability to pay (according to the IRS’ analysis). In this case, the taxpayer’s account can be placed into a status called Currently Not Collectible. It is also called Status 53, as the number 53 corresponds to the screen number that an IRS employee sees upon not collectible status being implemented. When in Status 53, your debt is placed in ‘hardship’ category, and the collection statute continues to count down.

Setting up a payment plan or installment agreement is the fourth alternative. This is just like any other payment plan you might be familiar with.

If you are in Chapter 13, a bankrupt status, you may also obtain tax debt relief. Some of the taxes and penalties or interest levied by the IRS may be discharged in this case.

Penalty abatement is another choice (the sixth we discuss here). In penalty abatement, quite simply, you are asking for those to be cancelled. The original tax debt is still owed.

Innocent Spouse relief is also possible. This, too, is what it sounds like – if your current or former spouse failed to report income, you may be entitled to relief.

When you have had tax issues with the IRS, you are well advised to seek professional assistance for resolving the matter.

Author Bio: American Tax Lawyer, Mr. Darrin Mish represents taxpayers all over the United States and on every inhabited continent. His many years of experience in dealing with tax problems benefit clients tremendously. For more information, visit American Tax Lawyer. Darrin may be reached by calling toll free (888) 438-6474.

Category: Legal
Keywords: Tax Attorney,Tax Lawyer,IRS Tax Attorney,IRS Tax Lawyer,IRS Attorney,IRS Lawyer